It seems like everyone is running some type of online sweepstakes campaign nowadays. Some of them good, some not so much. Here is our guide to running an effective (and legal) sweepstakes campaign online.
What is a sweepstakes campaign?
Sweepstakes are prize giveaways in which the winners are chosen by luck. Prizes can range from stickers and t-shirts to houses, cars, and enormous cash wins.
Many people use the terms “contests” and “sweepstakes” interchangeably. Technically, however, contests are giveaways that have some element of skill. For example, entrants need to answer a trivia question, write an essay, or create a recipe to participate.
Prizes and luck are central to sweepstakes; winners are drawn at random. In legitimate promotions, you never have to pay to enter a sweepstakes, and purchasing a product won’t improve your odds.
Before you start your campaign
Take into account that some states have their own sweepstakes rules. For example, New York requires you to bond prizes valued above $5,000.
In California, section 25600 of their Business and Professions Code states:
No licensee shall, directly or indirectly, give any premium, gift, or free goods in connection with the sale or distribution of any alcoholic beverage…
A 1999 court decision upheld that Section 25600 applies to sweepstakes prizes—alcohol as a prize is a definite no-no in California.
Remember that we’re in a borderless world
Online sweepstakes are essentially borderless, so they must comply with relevant laws in all 50 states and, unless the promotion is limited to U.S. residents, international laws.
There are an endless number of laws and regulations for different sweepstakes and prizes. We can’t possible cover them all—that’s for you to tackle.
Before you push a campaign live, go over all the relevant regulations or consult with an attorney and make sure what you’re doing is legal.
7 sweepstakes case studies
Plenty of marketing ideas—sweepstakes included—sound great. But do they really work? Here are seven case studies from a wide range of companies to show you what you can expect (if you nail your strategy).
Appsumo is a daily deals website for the coolest web apps and other digitally distributed goods. This is what they say about themselves:
We are an distribution channel for companies that help entrepreneurs start, grow, optimize, and scale their businesses. We connect them to hundreds of thousands of potential new customers using email marketing, social networks, and display ad campaigns.
Their numbers are impressive. In only 18 months, the company went from 0 to 500,000 customers. The numbers have only gotten more impressive:
- 730,000+ Newsletter subscribers;
- 132,000+ Twitter followers;
- 200,000+ Facebook fans.
How? A big part of their success is, you guessed it, sweepstakes. It’s true that they sell a lot of good software, guides, books, etc., with steep discounts. But they also regularly run sweepstakes campaigns with awards such as:
- Dropbox for life;
- Macbook Pro;
- Photoshop (including lifetime updates);
- Kindle Fire.
The have so many newsletter subscribers because to enter a sweepstakes, you first enter first your email address. After that, you can earn more “votes” (i.e. entries) by posting affiliate links of the campaign on social media—brilliant!
Another thing to note: All prizes align with AppSumo customer interests.
Unique Hotels is a small group of lifestyle hotels located mainly in Tallinn, Estonia. Each hotel is located in an historic building with updated surroundings that include modern conveniences.
- Create brand awareness through a focused social media campaign, encouraging content sharing among users.
- Generate leads and bookings by attracting visitors to the Unique Hotels website with special offers.
- Increase the Unique Hotels fan base (i.e. potential customers) with offers, campaigns, and attractive content.
- Create a new community channel for customer interactions, to provide updates, and to generate news.
- A month-long sweepstakes campaign on Facebook.
- Viral aspect of the campaign: The more sharing, the more points, and the greater the chances of winning both the weekly and main prize draws (a luxury all-inclusive weekend at Vihula Manor).
- To encourage sharing even further, they incorporated three ways to collect additional points and increase one’s chances of winning: the initial “Like,” sharing badges with friends, and subscribing to the Unique Hotels newsletter.
- Over the duration of the campaign, the Unique Hotel fan base went from 414 to 12,349 people.
- User engagement (any clicks on any stories) went from 2,108 to 30,944.
- Traffic to all Unique Hotels websites for November and December was 115% higher than each of the two preceding months.
- The Unique Hotels mailing list went from 600, predominantly Estonian subscribers to approximately 3,000 Estonian, English, and Russian subscribers.
Noritz manufactures tankless water heaters for home and commercial use. They’re sold through various distribution channels, primarily installers and dealers.
- Increase brand exposure and communicate directly with end users to increase sales.
- They ran a 12-month sweepstakes campaign (with monthly prizes) to attract new prospects, increase brand awareness, grow their subscriber list, and drive traffic to dealers via a locator tool.
- To drive traffic to the sweepstakes microsite, they used a geo-targeted Google Ads campaign.
- 45% registration rate;
- 28% referral rate;
- Substantial increase in subscriber list;
- High use of dealer locator tool.
Considering that Google Ads was the only channel to drive traffic, these are pretty impressive numbers. As with other campaigns, entrants earned extra entries by referring friends via email and social media.
Dodge brilliantly leveraged their NASCAR sponsorship to sell more cars.
- Build a database of new sales leads in the Northeast region.
- Ran a geo-targeted sweepstakes campaign on a microsite.
- Drove traffic to the site trough a geo-targeted pop-up that showed up only for customers in the Northeast who visited Dodge’s homepage.
- The grand prize winner got an all-inclusive trip to a NASCAR race of their choice.
Results included increased sales volume during the campaign and resulted 10,000+ new qualified leads on their e-mail list.
IDEON is a contract furniture company that specializes in high-quality, stylish lounge seating and tables. They created an online design tool to help visualize options and let prospective customers take creative control of their specs.
- The goal was to increase brand awareness and perception of the company and its design tool.
- IDEON had also recently formed a partnership with Maharam, and an added goal was to promote that partnership.
- IDEON created a 12-week online sweepstakes campaign.
- Prizes included 500 high-quality pillows, averaging 40 to 50 pillows per week.
- Email was the main traffic source, with the promotion sent to multiple lists: IDEON’s house list, trade show lists, and lists provided by reps.
- They also gave extra “votes” for signing up friends and social sharing.
- 24% increase in subscriber list;
- 31% referral conversion rate;
- 12% created account for online design tool;
- 43% unique open rate and 5% click through rate.
The results for an email-only campaign are pretty impressive—it’s safe to say they met their initial goals and then some.
Nõa Lihatööstus is a local brand in Estonia that sells pre-packaged meat products. They had an inactive Facebook fan page with a paltry 31 fans. At the same time, most of their target audience already used Facebook—clearly a lot of room for improvement.
- Get 3,000 new fans from target audience in three weeks.
- Add emails for 1,500 new potential customers.
- Create an Advent calendar app in Facebook. Each day, a new calendar window would open with a picture of the brand’s Christmas products.
- Participants got points for clicking on the windows, sharing on their wall, joining the mailing list, etc.
- At the end of each day, a random winner was selected from the pool of participants.
- 6,600+ new fans;
- 3,200+ email addresses;
- More than 60% of participants came via shared links;
- Many people had more than 25 “points,” meaning that they had successfully invited more than 19 individuals.
Mixergy offers access to interviews with entrepreneurs and masterclasses for startups.
- Increase social media followers and email subscribers.
- Ran a campaign that gave away free memberships in exchange for spreading the word.
- They used a landing page created with Contest Domination.
- 13,419 unique pageviews and 5,527 total entries;
- 1,147 new Twitter followers;
- 678 new likes for their Facebook page;
- 4,061 new emails.
While the absolute numbers are impressive, Mixery started with a decent following (an email list of about 45,000). The takeaway? Getting people to share your contest is not a given, even if you’re relatively well known.
Big or small, you’d better get the mechanics of your campaign right.
Mechanics of success for sweepstakes campaigns
Due to the huge number of possibilities for how you can run a sweepstakes campaign, using a specialized service or software can help you manage the contest.
Many choices exist, depending on your wants and needs. Here are a few:
When you’re ready to get started, here are principles to keep in mind:
Establish marketing goals ahead of time
Sweepstakes can provide various results when it comes to “customer engagement.” Different goals require different planning.
If your aim is to get X number of likes on your Facebook page, then the campaign has to have a Facebook component (duh).
Incorporate your strategic objectives into the sweepstakes campaign structure from the beginning.
Have prizes that your target customers want
Just because something is free doesn’t mean that people want it. Choose giveaways that attract your target audience and, hopefully, dissuade others from signing up.
The problem with having, say, an iPhone as the prize is that it will increase the number entries—from hundreds, or thousands, or millions with a likely lifetime value of zero. You want to fill your email list (or social media following) with people who actually care about your product or service, not random freeloaders.
Try to settle on prizes that your target customers want and that relate closely to your business.
Provide customer incentives
With so many sweepstakes on the web, a great prize is far from enough to get people to share yours. Encourage people to share by offering additional entries for liking, tweeting, or emailing.
Analsis of the Nõo Lihatööstus’s sweeps campaign showed that people were really motivated by the fact that the more people they invited, the better their chances of winning. Nearly two-thirds(!) of participants came via user-generated shares.
A 12-step checklist for your sweepstakes campaign
Sweepstakes law blog offers a list 12 things to do before organizing anything. Although it was made primarily for offline sweepstakes, many items on this list hold true in the online world:
- Is the sweepstakes limited to residents of the U.S. or one or more states or cities within the U.S.?
- Do the eligibility requirements for entrants clearly identify the age, residency, and other requirements for entrants to be eligible?
- Must individuals be at least 13 years old to enter?
- Is there a way to enter the sweepstakes by simply mailing a postcard with the entrant’s contact information to the sponsor?
- Are the odds of winning clearly set forth in the rules and are they equal for everyone who enters, including the mail-in entrants?
- Are the prizes described precisely and do they include all aspects and details, including the Approximate Retail Value for the total prize?
- Is the method of selecting the winner explained and is there a date and time stated for when the winner will be chosen?
- Is the sponsor’s name, address, phone number and web address listed prominently in the official rules and on all advertisements pertaining to the sweepstakes?
- Is the statement “No Purchase Necessary” and “Void Where Prohibited by Law” displayed in the rules and in all advertisements?
- Is the value of prize less than $5,000?
- Are employees of the sponsor prohibited from entering the sweepstakes?
- Is there an end date and time listed in the rules, and are the number of entries that each person may submit clearly stated?
If your answer to any of the above is “No,” you should definitely contact a lawyer who is experienced with sweepstakes assistance and guidance.
Three ways to increase sharing of your sweepstakes campaign
1. Incentivized share
With an incentivized share, brands put responsibility on consumers to participate. As there is an incentive (more votes = greater chance of winning), then consumers are often happy to share.
Wyndham Hotels and Resorts ran a Facebook sweepstakes in which the prize was three free nights at one of their hotels. After inserting their email address, entrants saw the following:
2. Soft share
With a soft share, consumers receive a reminder that they should share the sweepstakes with their friends and family. This is the least invasive and most polite way to ask for a share.
Lucky Magazine (now defunct) ran a sweepstakes campaign with the main prize a Chevy Spark. After completing registration, a little reminder box appeared to ask entrants to share:
3. Direct share
A direct share integrates the share call to action within the ad. It’s a bit in-your-face, but, then again, there’s a greater chance that your consumers will share it.
5 Mistakes to avoid with your sweepstakes campaign
1. Drafting incomplete rules
I’ll let Kyle-Beth Hilfer take over here:
Rules are the contract with the consumer. They provide the sponsor of the prize promotion protection in the event something goes wrong in the promotion. Yes, Twitter and mobile devices offer limited text space, and nobody wants a Facebook page to be crowded with legal disclaimers. But the rules can only protect a brand if they are disseminated to the public.
2. Not using magic words
Every sweepstakes must attach a “no purchase necessary” message to promotional materials (in a clear and readable font). If you don’t, you might end up being fined heavily, which is what happened to CVS years ago.
CVS offered an in-store sweepstakes—a “Trip of a Lifetime” sweepstakes with a grand-prize trip to Oahu, Hawaii—in which purchasers using a store loyalty card were entered automatically but non-purchasers had to go online to enter.
3. Holding your followers hostage
The thought of brands and people putting out posts that say, “Let’s share this”—so it’s good for me and people start following me and my awareness goes up—”and if you don’t, I’m going to hold you hostage from me pitching you some more,” is insanity.
4. Random prizes
Like we wrote earlier: iPhones and the like will bring in a huge number of people, but quantity isn’t the most valuable metric. Rarely do companies run sweepstakes for sheer numbers. They run them to get quality leads.
5. Not following rules
All sweepstakes campaigns have to adhere to various laws. Depending on the platform, your responsibilities may vary. Facebook in particular has very concrete rules—read them beforehand to save yourself a lot of trouble.
If not, you might end up like Cadbury or FCUK, which had their official Facebook pages in India taken offline for different violations. You don’t what that to happen to your brand (or client).
Done right, sweepstakes campaigns can bring in heaps of traffic, good leads, and endless opportunities for future sales. The companies showcased in this article enjoyed the success of a sweepstakes campaign years after it ended.
Then again, you have to be careful and make sure you know the rules and regulations of the country (and state) you operate in as well as the platform you’re using.